THE WORKPLACE SAFETY AND INSURANCE BOARD
APPEALS RESOLUTION OFFICER DECISION
DECISION NUMBER: 20150015
DECISION DATE: May 30, 2015
OBJECTING PARTY: Employer “C”
REPRESENTED by: Employer Representative
RESPONDENT: TG
REPRESENTED by: Worker Representative
HEARING: Hearing in Writing
HEARD by: B. Patlik, Appeals Resolution Officer
ISSUE
The employer representative is requesting the Workplace Safety and Insurance Board (“WSIB”) to find that contractor “TG” was an independent operator, not a worker of employer “C,” when he was injured on July 26, 2013.
BACKGROUND
C is in the construction business. TG provided safety consulting services to C. He was injured in a motor vehicle accident on July 26, 2013, while on his way to a worksite.
As part of the adjudication of the claim, the WSIB had to determine whether TG was a worker in the first place. To assist in the gathering of information, the WSIB contacted both TG and C, and had them complete organizational test questionnaires. Most of their responses differed from one another’s. A WSIB Account Specialist found that TG was a worker based on several factual points on which he accepted the information of TG over that of C. The employer representative objected, submitting that TG was an independent operator, not a worker of C. The employer representative completed an objection form, and the Account Specialist confirmed his decision and sent the matter to the Appeals Services Division.
AUTHORITY
Operational Policy Manual document 12-02-01 (“Workers and Independent Operators”).
ANALYSIS
To determine whether someone is a worker or an independent operator, the WSIB examines the terms of the business relationship and applies what is known as the “organizational test.” The organizational test deals with three main elements:
the degree of control that the individual is subject to in doing the work
the opportunity that the individual has to make a profit or suffer a loss in doing the work, and
other applicable criteria that characterize the work relationship.
The specific factors that come into play are set out in Operational Policy Manual (“OPM”) document 12-02-01 (“Workers and Independent Operators”).
The employer representative has opted for a hearing in writing, so my review consists of an analysis of the documentation on the employer file and claim file, as well as written submissions that the employer representative made to me.
Before analyzing the objection under the principles of the organizational test, I would like to address some of the more general points raised by the employer representative in his written submissions:
He states that, according to Memo #4, TG had “‘declined’ to register when he became aware of the ‘new construction rules.’” However, those new rules did not capture TG’s situation. The new rules relate to mandatory coverage in Class G, but TG was not performing a Class G activity in the first place. The business activity of safety consulting falls within a different Class and, as such, is not subject to the mandatory coverage policy. That is why TG’s status with C is examined by way of the organizational test.
The employer representative says that, in an audit, another firm providing the same services to C was found to be an independent operator. Having reviewed the file, I see that the facts of that relationship were found to be different than those for TG, so the other case does not provide a precedent for this one.
The employer representative points out that in Memo #24, dated March 11, 2014, a WSIB Case Manager said, “worker was self employed at time of injury.” However, the question of TG’s status was not before the Case Manager, and he or she did not make a decision about that status and had no jurisdiction to do so. Memo #24 was a review of claims entitlement issues, and TG’s status had already been addressed by the proper area, that is, by the Account Specialist, and the employer representative was already in the process of objecting directly to the Account Specialist. Further, throughout the rest of Memo #24, which is more than three pages long, TG is referred to repeatedly as the “I/W” (injured worker) or the “worker,” so the use of the term “self employed” on that one occasion is, if anything, an anomaly within the Memo.
Turning, now, to the question of TG’s status under organizational test principles, I find that TG was a worker of C, not an independent operator, at the time of the injury in question.
Control
As I have said, most of the parties’ answers differed from one another’s. Since there was no written contract between TG and C, and the only supporting documentation submitted to the WSIB consists of invoices from TG’s company, it is difficult to determine the facts under this aspect of the organizational test from just reviewing the file. However, that is the kind of review requested by the objector’s representative. Therefore, in order for me to find that he has established a basis for overturning the Account Specialist’s findings, the evidence presented has to prove his case. For the most part, it does not.
The two parties disagree about whether TG was instructed about how to do the work. Under the organizational test policy, it is indicative of independence if the person works on their own schedule and does the job their own way; if they comply with instructions about what, when, where, and how the work is to be done, that is an indicator of worker status. In the case under appeal, there is no information on this point other than the competing answers in the questionnaires. Therefore, I find that C has not carried its burden of proving that TG was not instructed in the ways that make a person a worker.
The parties also disagreed regarding whether TG was trained and supervised by C, but I think it can be safely assumed that in hiring a safety consultant, C was looking for someone who knew how to do that work. As a result, I am willing to accept that TG was not trained or supervised in a way that would indicate worker status.
C acknowledged in its questionnaire that TG had to do the work personally. That is an indicator of worker status rather than independence.
TG said on his questionnaire that the hours and days of work were set by C, but C disagreed. However, according to a November 15, 2013 email from C’s Health and Safety Supervisor (“D”) to the Account Specialist, TG’s function included “being present or presenting daily safety talks/tailgate meetings, ensuring (by means of advising management) that we maintain compliance with Provincial and client enforced rules, regulations, requirements and guidelines, assisting and or compiling project safety compliance reporting for submission to our clients, safety related administration work i.e. maintaining/creating employee files documenting their training, performing training sessions for our staff and employees including WHMIS-Fall Arrest-Confined Space-Chain Saw-Propane-Fire Extinguisher-Cut/Saw-Forklift-Crane-Flag Person and Health and Safety.” Most of this work would involve interacting with the construction workers, at times when they were available for meetings and not doing their actual construction work, and when the performance of their work and the site conditions were able to be observed. I am not persuaded that TG had much choice over when the circumstances in which he could do these tasks would exist. Therefore, I find that this element demonstrates worker status for TG, not independence.
TG indicated that he had to work for C full-time and was restricted from doing work for other companies in the same industry. C disagreed on both points. As I will address in more detail below under “Profit/Loss,” TG did in fact work full-time for C. Due to the full‑time nature of the work, he would have been restricted by the circumstances, if not by the specific terms of a contract, from working for others during the course of his working relationship with C. This is indicative of worker status.
Next, the organizational test looks at whether the order or sequence of the work is determined by the hirer. There is no evidence about whether C set the order or sequence of the work, so I cannot find that it did not do so. In any event, under the worker/independent operator policy, it says worker status is indicated on this point if the person “performs services at their own pace” and they “work on own schedule.” As I have said, above, I find that TG’s work was dictated by the availability of the workers and what was happening on-site. Therefore, I do not find that he performed the work at his own pace and according to his own schedule. As a result, under the “order or sequence” aspect of the organizational test, I do not view TG as an independent operator.
TG invoiced C for his services, at the rate of $35 per hour. Since his hours varied, so did the amounts he invoiced and was paid. However, there is no evidence about whether the hourly amount was arrived at by negotiation or was demanded by one party or the other. Therefore, I cannot find that C has proven that the method of payment shows TG to have been an independent operator.
The parties agreed that any licensing that was required was held by C. This is indicative of worker status.
The last consideration under the control portion of the organizational test relates to “serving the public.” Here, the evidence leads to mixed results. The policy says a person is a worker if they do not make their services available except on behalf of, or as a representative of, the payer, and if they invoice customers on the employer’s behalf. On the other hand, the person is independent if they have their own office, are listed in business directories and maintain a business telephone, advertise, and invoice customers on their own behalf. TG invoiced C, but if C was his only client, that is not in itself very meaningful. It could just be the way the parties – possibly just the payer – wanted to document the hours and pay. TG said he advertised, but he worked out of premises owned or controlled by C, and there is no information about whether he had his own business phone number. However, as acknowledged by C (and as I will refer to again, below, under “Profit/Loss”), for his work with C he used a phone provided to him by C. In the end, even if I were to find that the criteria about “serving the public” weighed more heavily toward independence than worker status, that would not change the outcome. All of the other aspects relating to control, except the one regarding training and supervision, indicate worker status.
Profit/Loss
In this part of the organizational test, the WSIB focuses on the ownership of and financial responsibility for assets used and costs incurred in doing the work. It also looks at the individual's market mobility.
According to the WSIB’s policy on worker/independent operator status, if the person makes or has the right to make decisions that, compared to those of the hirer, have an insignificant or lesser effect on their opportunity to make a profit or risk suffering a loss in doing the work, that is regarded as indicating worker status. If their own decision-making regarding profit/loss is more significant than that of the hirer, that is considered to be indicative of independent operator status. The evidence in the case under review is that, in the context of the relationship between C and TG, the individual had very little decision-making that affected his profit/loss situation. For this reason, I find that this element of the organizational test points toward worker status for TG.
The information provided by both parties is that C supplied the assets used to perform the work. TG said on his questionnaire that he provided labour only and that the costs incurred in doing the work were paid for by C. In its own questionnaire, C indicated that it paid for the truck, laptop/printer and phone. According to the police report relating to the accident, the truck TG was driving was owned by C. On two occasions, D told the WSIB that certain assets used in doing the work were owned by C. He told the Account Specialist on November 6, 2013 that TG was provided a company truck and laptop. According to Memo #15 in the claim file, dated December 16, 2013, D told a WSIB Case Manager that TG was going to be “returning any equipment that belonged to the employer (i.e. cellphone and computer).”
Further, both questionnaires indicated that responsibility for any unsatisfactory work on TG’s part did not fall to TG. TG stated that if work required correction, that was up to C. C stated that it would be up to “his” – presumably TG’s – “replacement.” Both parties said TG would not be responsible for the costs of additional work to make things right.
Therefore, there was very little that TG was financially responsible for, or made entrepreneurial choices about, in the context of his relationship with C.
The WSIB’s policy on worker/independent operator status also looks at “the market mobility of the person or the demand that exists for these services.” What the WSIB is looking at is whether the individual opted to perform work for the hirer, having made an entrepreneurial choice to go with the hirer amongst multiple potential clients, or whether he basically had to take the work where he could get it and the hirer was the only option or one of very few. No direct evidence has been provided about what opportunities TG had in the marketplace, but he did work solely for C. C has claimed otherwise, but at the same time it did provide the WSIB with a list of hours worked by TG during 21 pay periods between August 2012 and January 2013, and they varied from a low of 32 hours in one case to 68 hours in another. The average was just under 50 hours per pay period, with each pay period varying from a few days to a full week. This does not prove one way or another whether TG had the entrepreneurial choice of working elsewhere, but the burden of proof is on C, and C has not demonstrated that TG had market mobility and that there was a demand in the marketplace for his services.
Considering the evidence that has been provided, and referring back to what it says in OPM document 12-02-01, I find that TG made or had the right to make decisions that were less significant than those of C in determining whether and to what degree he made a profit or suffered a loss in doing the work. Under the organizational test, this is indicative of worker status, not independence.
Other Applicable Criteria
There is no dispute between the parties that TG operated through a company of his own, invoiced C, charged and remitted HST and advertised, and he seems to have had a bookkeeper. However, I find that TG did not in any substantive way operate as a separate business from C when performing work for it. In the context of that relationship, he was integrated into C’s business. In other words, he was part of C’s organization rather than running an organization of his own. This is demonstrated by the fact that the evidence relating to the “other applicable criteria” supports a finding of worker status.
C does have what the WSIB refers to as a “continuing need” for the type of service provided by TG. His hours totaled more than 40 per month and he worked there full‑time for a span that far exceeded four months. Further, D said TG was training someone else to do the work in the future because he was being phased out. This indicates C needed someone on a continuous basis to perform the work TG was doing. Under the organizational test, a continuing need for the service provided by the person in question is evidence of worker status.
TG indicated on his questionnaire that he hired, supervised and paid workers at the direction of C, acting as a supervisor or representative of C. C stated the opposite. It is not clear why these answers differed and whether one party or the other misinterpreted the question or merely answered incorrectly. However, TG told the Account Specialist that he did not hire workers, and there is no mention anywhere else on the record that he had help. At the end of the day, C has not proven that TG did hire, supervise and pay workers of his own. Therefore, under this aspect of the organizational test, I find that the finding of worker status has not been undermined.
Both questionnaires indicated that the work was done on premises owned or controlled by C. This is an indicator of worker status.
Both TG and C stated on their questionnaires that TG had to submit regular oral or written reports to C, so they are in agreement on a point that indicates worker status.
The parties were also in agreement that TG could sever the relationship at any time. There is no information as to whether C could do so. However, the relevant fact is that TG’s ability to walk away demonstrates worker status. A worker can quit at will without notice and without liability for breach of contract for leaving work uncompleted. In the case of an independent operator, on the other hand, notice is typically required and the contractor is usually responsible for costs arising out of their termination of the relationship. So, the information provided by the parties on this point is supportive of a finding of worker status.
Finally, there is no evidence that TG worked for more than one payer at a time, and the high number of hours he worked for C indicates that he did not. If he did any other work (which, as I have said, there is no evidence of), given the significant time commitment he made to C any other work would seem to have been in the nature of moonlighting. This is indicative of an employment relationship in his work with C, not independent operator status.
In light of the information available, I do not find that TG, at least in his work for C, operated as his own separate business organization. As a result, he does not meet the criteria to be regarded as an independent operator in that relationship for WSIB purposes.
CONCLUSION
TG was a worker of C, not an independent operator, when he was injured on July 26, 2013.
The objection is denied.
DATED March 30, 2015.
B. Patlik
Appeals Resolution Officer
Appeals Services Division